A corporation whose shares are held by a single shareholder or a closely-knit group of shareholders (such as a family) is known as a close corporation. The shares of stock are not traded publicly. Many of these types of corporations are small firms that in the past would have been operated as a sole proprietorship or partnership, but have been incorporated in order to obtain the advantages of limited liability or a tax benefit or both.
A buy-sell agreement is an agreement between the owners (shareholders) of a firm, defining their mutual obligations, privileges, protections, and rights. This form is a generic example that may be referred to when preparing such a form for your particular state. It is for illustrative purposes only. Local laws should be consulted to determine any specific requirements for such a form in a particular jurisdiction.
Fairfax, Virginia Stock Agreement — Buy Sell Agreement between Shareholders and Corporation is a legal document that outlines the terms and conditions of buying and selling stocks in a corporation. This agreement serves as a guide for shareholders and the corporation, ensuring a smooth and organized process of stock transactions. In Fairfax, Virginia, there may be different types of Stock Agreements — Buy Sell Agreements between Shareholders and Corporations, namely: 1. Cross-Purchase Agreement: This type of agreement allows shareholders within a corporation to agree to buy each other's stocks in the event of a specific triggering event such as death, disability, retirement, or termination. It ensures that the remaining shareholders have the opportunity to purchase the departing shareholder's stocks. 2. Redemption Agreement: This type of agreement requires the corporation to redeem the stocks of a shareholder in specific situations outlined in the agreement, such as death, disability, or retirement. The corporation purchases the shares directly from the shareholder, effectively eliminating that shareholder's ownership in the company. 3. Hybrid Agreement: A hybrid agreement is a combination of both cross-purchase and redemption agreements. It offers flexibility to shareholders by allowing them to decide whether the corporation or other individual shareholders will buy their stocks in specific triggering events. The Fairfax, Virginia Stock Agreement — Buy Sell Agreement between Shareholders and Corporation typically covers several important aspects: 1. Purchase Price Determination: The agreement outlines the method to determine the fair value of stocks during a buy-sell transaction. It may specify the use of appraisers or pre-determined formulas to establish a mutually agreed purchase price. 2. Triggering Events: The agreement identifies certain events that trigger the buy-sell provisions, such as death, disability, retirement, or termination. These events may vary depending on the agreed-upon terms between the shareholders and corporation. 3. Restrictions on Stock Transfer: The agreement may contain restrictions or limitations on the transferability of stocks, ensuring that the shares remain within the corporation or are purchased by existing shareholders. 4. Funding Mechanisms: The agreement may specify the funding mechanisms for stock purchases, such as life insurance policies, installment payments, or corporate funds. This ensures that the purchasing party has the necessary funds to fulfill the buy-sell obligations. 5. Dispute Resolution: The agreement may include provisions for dispute resolution mechanisms, such as arbitration or mediation, to resolve conflicts that may arise during the buy-sell process. Overall, the Fairfax, Virginia Stock Agreement — Buy Sell Agreement between Shareholders and Corporation is a legally binding document that protects the rights and interests of both shareholders and the corporation. It provides clarity and guidance for the buying and selling of stocks, ensuring a smooth transition in ownership and promoting the stability of the business.Fairfax, Virginia Stock Agreement — Buy Sell Agreement between Shareholders and Corporation is a legal document that outlines the terms and conditions of buying and selling stocks in a corporation. This agreement serves as a guide for shareholders and the corporation, ensuring a smooth and organized process of stock transactions. In Fairfax, Virginia, there may be different types of Stock Agreements — Buy Sell Agreements between Shareholders and Corporations, namely: 1. Cross-Purchase Agreement: This type of agreement allows shareholders within a corporation to agree to buy each other's stocks in the event of a specific triggering event such as death, disability, retirement, or termination. It ensures that the remaining shareholders have the opportunity to purchase the departing shareholder's stocks. 2. Redemption Agreement: This type of agreement requires the corporation to redeem the stocks of a shareholder in specific situations outlined in the agreement, such as death, disability, or retirement. The corporation purchases the shares directly from the shareholder, effectively eliminating that shareholder's ownership in the company. 3. Hybrid Agreement: A hybrid agreement is a combination of both cross-purchase and redemption agreements. It offers flexibility to shareholders by allowing them to decide whether the corporation or other individual shareholders will buy their stocks in specific triggering events. The Fairfax, Virginia Stock Agreement — Buy Sell Agreement between Shareholders and Corporation typically covers several important aspects: 1. Purchase Price Determination: The agreement outlines the method to determine the fair value of stocks during a buy-sell transaction. It may specify the use of appraisers or pre-determined formulas to establish a mutually agreed purchase price. 2. Triggering Events: The agreement identifies certain events that trigger the buy-sell provisions, such as death, disability, retirement, or termination. These events may vary depending on the agreed-upon terms between the shareholders and corporation. 3. Restrictions on Stock Transfer: The agreement may contain restrictions or limitations on the transferability of stocks, ensuring that the shares remain within the corporation or are purchased by existing shareholders. 4. Funding Mechanisms: The agreement may specify the funding mechanisms for stock purchases, such as life insurance policies, installment payments, or corporate funds. This ensures that the purchasing party has the necessary funds to fulfill the buy-sell obligations. 5. Dispute Resolution: The agreement may include provisions for dispute resolution mechanisms, such as arbitration or mediation, to resolve conflicts that may arise during the buy-sell process. Overall, the Fairfax, Virginia Stock Agreement — Buy Sell Agreement between Shareholders and Corporation is a legally binding document that protects the rights and interests of both shareholders and the corporation. It provides clarity and guidance for the buying and selling of stocks, ensuring a smooth transition in ownership and promoting the stability of the business.
